Maryland Man Pleads Guilty to Role in Scheme to Steal Money from U.S. Bank Accounts

A Maryland man pleaded guilty today in Baltimore federal court to conspiracy to commit bank fraud.

According to court documents, Theodore Sapperstein, 66, of Pikesville, and his coconspirators unlawfully debited money from the bank accounts of unknowing U.S. victims without their authorization. Sapperstein and his coconspirators created shell companies and then falsely represented that debits against consumer-victims’ bank accounts were authorized as payment for services allegedly provided by those shell companies.

The unauthorized debits against consumer-victim accounts resulted in returned transactions and high return rates that could generate scrutiny from banks. To both conceal and continue making unauthorized debits, Sapperstein and his coconspirators caused “micro debit” transactions (i.e., a large number of low-value sham transactions) to be made against other bank accounts that they controlled and/or funded, and which they knew would not result in returns. The “micro debits” were therefore used to artificially lower return rates to levels that Sapperstein and his coconspirators believed would reduce bank scrutiny and potential termination of banking services. Sapperstein helped broker payment processing for the fraud scheme, securing a payment processor who processed the unauthorized debits and the fraudulent micro debits. As part of his guilty plea, Sapperstein admitted that more than $1.5 million in loss was reasonably foreseeable to him.

“Those who knowingly participate in schemes to use personal and financial information about American consumers to steal money from their accounts will be held accountable,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We are committed to investigating and prosecuting individuals who facilitate such schemes.”

“The U.S. Postal Inspection Service (USPIS) will not tolerate schemes aimed at draining the accounts of innocent people trying to create financial stability for themselves and their families,” said Inspector in Charge Carroll N. Harris of USPIS' LA Division. “Postal Inspectors along with their law enforcement partners will tirelessly investigate these crimes, ensuring these criminals face the maximum penalties for their illegal activities.”

“We formed the Maryland Financial Intelligence Task Force to identify financial fraudsters, whose actions impact victim-account holders here in Maryland and beyond,” said U.S. Attorney Erek L. Barron for the District of Maryland. “Our goal is to aggressively protect the financial information of public consumers.”

A sentencing hearing is scheduled for Aug. 15. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Cases against related scheme participants have previously been filed in Los Angeles, San Diego, and Las Vegas. In May 2023, a grand jury in Los Angeles returned an indictment in United States v. Courdy, et al. charging 14 defendants with RICO conspiracy and other charges in the Central District of California. The indictment alleges that the defendants and associates debited consumer-victims’ bank accounts without authorization and used shell entities and “micro debits” to conceal the activity from banks. The “Information for Victims in Large Cases” section on the Consumer Protection Branch’s website contains additional information on United States v. Courdy, et al. In December 2023, scheme participant Luis Ramirez pleaded guilty to conspiracy to commit access device fraud in federal court in San Diego, and is scheduled to be sentenced on April 22. A related scheme participant, Harold Sobel, pleaded guilty to bank fraud conspiracy in federal court in Las Vegas. In December 2022, Sobel was sentenced to 42 months in prison.

The U.S. Postal Inspection Service is investigating the case.

Trial Attorneys Wei Xiang, Meredith Healy and Amy Kaplan of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Darryl Tarver for the District of Maryland are prosecuting the case, with assistance from the U.S. Attorney’s Office for the Central District of California.

For more information about the Consumer Protection Branch and its enforcement efforts, visit www.justice.gov/civil/consumer-protection-branch. Consumer complaints may be filed with the FTC at www.reportfraud.ftc.gov/ or at 877-FTC-HELP. The Justice Department provides a variety of resources relating to fraud victimization through its Office for Victims of Crime, which can be reached at www.ovc.gov.